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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (652)	3/31/2000 10:41:00 AM
From: Chip McVickar	Read Replies (1) \| Respond to of 33421

John, The "M" pattern on the Nasdaq daily chart is a classic Topping Pattern and the books say it indicates the beginning of a bear market. It's more similar to a double top then a head and shoulders. However, it's set apart by having well defined characteristics that must fall into place. Chart Bar: siliconinvestor.com Line Chart: siliconinvestor.com Characteristics: Stocks have been rising for a long time 1) Earlier high is put in with a retrace 2) Higher High 3) Lower low then (1) 4) Lower high then (2), but higher then (1) 5) Close Lower then (3) Breakdown line is drawn horizontally on the chart, beginning from the low of (3). The pattern can take several weeks to form. Once the low of #5 is in place there can be retracements back to the breakdown line before a more sustained decline gets underway. It's reverse is a "W" pattern for bottoms. For today's market...., the "M" pattern is in place as required except for a close below (3) at 4455.10. The interday price printed 4355.69, but the market closed at 4457.91...no cigar. <<smile>> This is a clear chart sign that lower prices on the Nasdaq have a high probability. Chip